15 June 2011 17:32 [Source: ICIS news]
LONDON (ICIS) – Leading European potash producer K+S has alerted its customers to a €10/tonne ($14/tonne) increase in potash fertilizer prices resulting from robust demand and high agriculture commodity prices, a company official said on Wednesday.
This puts granular muriate of potash (MOP) at €363–368/tonne on a CIF (cost, insurance & freight) basis. Sulphate of potash prices have now climbed to €453–458/tonne CIF.
Standard MOP is now being offered at around €343/tonne CIF. Industrial users, who purchase small quantities of standard MOP on contract, have already accepted the increases, but nitrogen phosphorus potassium (NPK) fertilizer producers are due to enter price negotiations with K+S next week.
“I think this is no surprise to our customers,” said a K+S spokesman. “They knew it was coming: they have asked us about it since [May].”
European traders say agribusinesses have no choice but to accept the higher prices. The price increase from K+S is, however, a more conservative increase than some buyers were expecting for the third quarter.
The new prices take effect immediately and will be used as the company’s official selling prices until further notice. The company has not concluded any spot sales at the new price levels.
K+S’s decision to increase potash prices follows the May announcement by international marketer Belarusian Potash Company, which set the Brazilian spot sales price target at $550–560/tonne CFR (cost & freight). ?xml:namespace>
K+S is a Germany-based producer and has a production capacity of 7.5m tonnes/year.
For more on K+S, visit ICIS company intelligence
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